Queen Creek officials intend to make newcomers, rather than existing water customers, pay for the costs of future growth under a rate proposal discussed at the Oct. 7 Town Council meeting.
“We are drawing a line in the sand,” said Scott McCarty, deputy town manager and chief financial officer. “Existing customers will pay their fair share while newcomers will pay their fair share.”
Queen Creek’s water future is an underlying current in town decisions as a lack of an assured 100-year water supply was a deciding factor in a split decision against rezoning for a proposed 150-unit rental development.
The 3.1 million acre-feet of water secured for $370 million covers existing 46,000 water customers, said consultant Andy Burnham of Stantec.
Ten-year growth projections call for 20,700 more housing units, with an estimated $170 million in water supply costs.
That $170 million would come from two impact capacity, or hook-up, fees. For single-family houses, the water delivery fee would go from the current $2,328 to $4,591.
New customers would face a one-time water resource fee, which is proposed for $6,119 for houses with town sewer and $10,999 for those water-only customers.
Proposed fees include credits for wastewater recovered by the Queen Creek sewer system.
If those two recommended fees are approved, the total one-time impact capacity cost for a new Queen Creek single-family house would go from $13,038 to $21,366 or $25,446, depending on sewer status.
If those fees don’t cover the additional water costs, they would be added to the newcomers’ monthly water resource fees and not to existing customers, Burnham said.
The Oct. 7 water discussions were information only. No Council action was taken.
Rezoning defeated 3-2
Town Council also last week voted 3-2 against a rezoning of 1.6 acres in far northwest Queen Creek for the 150-unit Summerwell Residences rental development.
The site, 300 feet east of the northeast corner of Germann and Power roads, is zoned commercial, but has been vacant for over two decades.
The Queen Creek Planning & Zoning Commission last month recommended 7-0 that rezoning be changed to medium density residential.
Greystar, a Charleston, S.C.-based international real estate company, proposed 102 single-family units and 48 duplex units in a development that would be 40% open space.
That had half the population density in an apartment project that was unsuccessfully proposed for the site in 2024.
Summerwell Residences would have been part of a growing stock of Queen Creek houses that are built for rent or lease – not for sale.
Mayor Julia Wheatley and councilmembers Jeff Brown and Robin Benning voted against the rezoning while Bryan McClure and Leah Martineau supported it. Councilmembers Travis Padilla and Dawn Oliphant were absent.
Such multifamily developments are exempt from state requirements to prove a 100-year water supply.
“Water is a focal point for this council, securing a 100-year supply,” Wheatley said. “I feel disingenuous saying we are focused on our residents, making sure we have 110 years, but we are going to approve this development and they don’t have to (prove a 100-year water supply).”
Brown had been an outspoken opponent of the rezoning.
“In interactions with residents in town, it is clear to me that they are not pleased with the number of rezonings we have done, especially for rental,” he said before the vote. "We’re really setting ourselves up for the pitchfork?type town council meetings where the chambers will be packed with people that say, ‘Apparently, you didn’t hear me,’.’”
Water resource fee coming
Establishing a water resource fee Nov. 18 will be the latest chapter in Queen Creek’s decade-long saga to achieve water self-sufficiency,
The drama peaked late last year and early this year when the town secured 1.7 million acre-feet of water over the next 100 years from the Harquahala Basin. The total price tag of that project, including infrastructure costs, is projected at $465 million.
That’s over half the 3.7 million acre-feet of water Queen Creek has lined up from various sources. (An acre foot is 325,851 gallons of water, which the state says equals the annual consumption of three average households.)
Town officials say Queen Creek’s water supply will be drought- and supply chain-proof for the next century.
Total costs of those projects will run $730 million, including principal and interest, which are scheduled to be paid off over the next 30-40 years.
That’s where the water resource fee comes in.
Assuming Council sets the first year of the fee on Nov. 18, it will kick in Jan. 27 for Queen Creek water users and appear on bills starting March 9.
The current proposal for year one is $3.07 per 1,000 gallons of water, based on usage.
Monthly fees are expected to increase for the next six years.
With the current proposal, the residential customer impact per month (based on 10,000 gallons) would be $30.70 for water customers not on the town sewer system and $18.42 for customers with a wastewater credit. About half of Queen Creek’s water customers are on town sewers and will receive that credit.
Town officials hope to be able to refinance some of the $730 million in payments past the 30-and 40-year terms so costs are spread more equitably over the next century.
The Harquahala purchase was well-timed. Queen Creek was the first municipality to tap into that source, securing the water at $15,000 per acre-foot for the next century.
Harquahala water is reportedly going for $30,000 an acre-foot after Arizona’s share of Colorado River water was cut by 30%.
Colorado River water will comprise only 10% of Queen Creek’s water portfolio while some Valley municipalities get 40% or more of their water from the dwindling, over-committed source.
The Harquahala Basin sits on 766 square miles in LaPaz and Maricopa counties in west central Arizona, about 80 miles from Queen Creek. It is a water storage basin designated by the state for transportation to other areas.
The water will be delivered by the Central Arizona Project canal, which runs just east of Queen Creek.
Queen Creek has sufficient groundwater in its aquifer to supply the town’s needs but plans to get only 6% from that source. Replenishing that water, as required by the 1980 Groundwater Act, would be more expensive than importing it, according to town officials.
Currently, 89% of Queen Creek’s water customers are assessed a Central Arizona Groundwater Replenishment District (CAGRD) fee on their annual property tax bill. The town has been paying CAGRD fees for customers since 2018, saving customers $71 million.
The CAGRD fee will be included in the monthly water resource fee.
Closed council sessions
While the town has a busy schedule of public meetings to discuss the 100-year water plan and water resource fee, Council met four times in just over a month in closed-door executive sessions to discuss Harquahala strategy.
According to the posting notices for the executive sessions, the Town Council is seeking “legal advice.” That’s one of the exemptions that the state open meetings law allows for closed-door meetings.
Any voting decisions resulting from executive session discussions, by law, must be taken in public meetings.
Here is a typical agenda posting for those meetings:
“Discussion and consultation with the Town’s attorneys for legal advice and with the Town’s attorneys and Town’s representatives regarding the Town’s Harquahala Valley groundwater acquisition, delivery and infrastructure strategies and obligations including long-term financing strategies and contractual obligations, capital cost recovery, debt service agreements, and related legal and contractual parameters of associated utility rates, fees and charges.”
Cutting, calculating costs
Conservation is part of Queen Creek water self-sufficiency plans. For example, the town, along with SRP, has been conducting a turf replacement program, where customers get rebates for replacing grass and other high water-use vegetation with drought-tolerant landscaping.
The current overseeding for winter grass is one of the high water-use times. For example, 20% of the average HOA’s water bill goes for overseeding.
Information on Queen Creek water conservation programs: queencreekaz.gov/government/utilities/water/water-conservation
Queen Creek has launched a website (queencreekaz.gov/waterfuture) that includes an online calculator to help customers figure out their likely future water costs.
The town has also scheduled several informational meetings preceding the Nov. 18 vote.
Public meetings
Tuesday, Oct. 13, 5:30 p.m. Community Chambers, 20727 E. Civic Parkway.
Oct. 20, 5:30 p.m. Community Chambers, 20727 E. Civic Parkway.
Weekly open house/office hours:
• Monday, Oct. 12, 9-11 a.m.
• Tuesday, Oct. 20, noon-2 p.m.
• Wednesday, Oct. 28, 4-6 p.m.
• Thursday, Nov. 5, 10 a.m.-noon
• Monday, Nov. 9, 3-5 p.m.
• Tuesday, Nov. 17, 4-6 p.m.
All meetings in the San Tan Conference Room of the Municipal Services Building, 22358 E. Ellsworth Road.
HOA meeting for managers and board of directors: Tuesday, Oct. 13, 4 - 5 p.m., Community Chambers, 20727 E. Civic Parkway.